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Income Tax Appellate Tribunal, DELHI “G” BENCH: NEW DELHI
Before: SHRI YOGESH KUMAR U.S & SHRI MANISH AGARWAL
The present appeal is filed by the assessee against the order dated 10.09.2024 passed by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld. CIT(A)”] in Appeal No. NFAC/2014-15/10116942 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of the assessment order dated 23.03.2022 passed u/s 147 r.w.s. 144B of the Act pertaining to Assessment Year 2015-16.
Brief facts of the case are that the assessee is a Doctor by profession and during the year under appeal, has deposited cash in bank account however, no return of income was filed. Thereafter, the assessee suo-motto filed self-declaration letter dated 31.12.2019 alongwith belated manually return of income wherein total income Page | 1 was declared and due taxes were paid. Based on the said self- declaration, proceedings u/s 148 of the Act were initiated and in response to notice u/s 148 dated 16.03.2021, the assessee has filed the return of income, declaring total income at INR 43,30,370/- on 23.03.2021. Thereafter, during the re-assessment proceedings, AO observed that the assessee has made cash deposits in the joint bank account maintained with her wife with Union Bank of India Account No 564202010002709 of INR 8.79 Lakhs on various dates. With respect to the source thereof, it was explained by the assessee that these deposits was made by his wife Smt. Deepa De and an affidavit to this effect of Smt. Deepa De was also filed, wherein she affirmed on oath that the cash was deposited in the said account by her out of her income from vocational classes of singing. The AO in absence of the supporting evidences of such claim made by Smt. Deepa De, held the said cash deposit as unexplained money of the assessee and made the addition of the said amount as unexplained cash credit u/s 68 of the Act in the hands of the assessee.
Against this order, an appeal was filed before Ld.CIT(A) who dismissed the appeal of the assessee. Aggrieved by the said order, the assessee is in appeal before the Tribunal on the strength of following grounds of appeal:-
1. “On the peculiar facts of the case, the proceedings carried out by the learned AO/NFAC ought to have been held to be bad in law.
2. On the peculiar facts of the case, the assessment order passed by the NFAC ought to have been held to be bad in law. 3. On the peculiar facts of the case and in law, the order passed by the learned CIT(A)/NFAC is liable to be annulled because there is no power conferred upon the CIT(A) to assess a particular item under different provision of the Act what the Assessing Officer had done Page | 2 without giving a specific notice to the assessee regarding such action. 4. On the peculiar facts of the case and in law, the addition of Rs.879000/- is liable to be deleted.”
4. Before us, Ld.AR for the assessee submits that the cash was deposited by wife of the assessee who was taking classical singing classes and the fees was received in cash which stood deposited in the joint bank account. It is further submitted by Ld.AR that the cash deposited was utilized by Smt. Deepa De for making payment for the booking of a flat owned by her. Thus, there is a direct nexus between the cash deposited and utilization thereof. He further submits that Smt. Deepa De had filed an affidavit duly confirming these facts and the same remained uncontroverted and therefore the same should deserved to be accepted. For this, reliance placed on the judgement of Hon’ble Supreme Court in the case of Mehta Parikh & Co. vs CIT [1956] 30 ITR 181(SC). Ld.AR further submits that AO has not cross-examined Smt. Deepa De before rejecting the affidavit filed by her with respect to the cash deposited in the bank account jointly owned by the assessee with her. It is further submitted by Ld.AR that the AO has invoked the provision of section 68 for making the addition. However, Ld. CIT(A) has converted the same as unexplained money u/s 69A without providing any opportunity or without issuing a show cause notice before holding so. Thus, as per ld. AR, such action of Ld. CIT(A) is not in accordance with laws. He thus, prayed for the deletion of the addition made.
5. On the other hand, Ld. Sr. DR for the Revenue vehemently supported the orders of the lower authorities and submits that AO in para 4 of the assessment order observed that the assessee was non-return filer though he had taxable income thus, it could be seen that the assessee is a habitual defaulter. He further submits that the AO also observed that no books of accounts were maintained by the assessee and they were prepared in the month of December 2019 and thereafter, they got audited however, this joint bank account where the alleged deposits were made is not forming part of the books of accounts of the assessee. The assessee also failed to file the details of the students to whom his wife Smt.Deepa De was giving coaching of singing classes nor any evidences for such income was filed. He, therefore, prayed for the confirmation of the addition made by the lower authorities.
Heard the contentions of both the parties and perused the material available on records. From the perusal of the assessment order and the appellate order, we find that the assessee suo-motto filed return of income though belatedly wherein he had declared income of INR 43,30,370/- and paid due taxes. It is only after the information received from the assessee with respect to such income, the case of the assessee was re-opened in terms of the issue of notice u/s 148 of the Act. The assessee himself declared the income and paid the taxes and if the cash deposits in joint bank account were made by him, it is not acceptable as to why he had not included this cash deposits in his total income. This leads to believe that the cash deposits belonged to his wife Smt. Deepa De who was running vocational course of classical singing to the students. Page | 4 Since Smt. Deepa De was doing this activity on vocational basis at a very low level at her residence therefore, it could be possible that no day-to-day details of students were kept by her. Further, it is a fact on record that she had accepted the deposits made out of her own income and duly affirm this fact in the affidavit filed before the lower authorities which was not controverted by cross-examining Smt. Deepa De by the AO nor any contrary evidence was brought on record to hold the contents of the said affidavit as false. The Hon’ble Supreme Court in the case of Mehta Parikh & Co (supra) has held that uncontroverted affidavit should not be ignored and the contents thereof must be considered as true and correct. Looking to the affidavit of Smt. Deepa Dey, stating that the cash deposited in the joint bank account maintained by her with the assessee is out of her own money saved from coaching classes run by her, could not be disbelieved without any contrary material. In view of these facts and circumstances of the case, in our considered opinion, no addition could be made with respect to the cash deposited in the joint bank account, source of which is explained as out of the income of the wife of the assessee as unexplained money u/s 69A of the Act. Accordingly, we hereby direct the AO to delete the addition. Both the grounds of appeal taken by the assessee are allowed.
In the result, the appeal of the assessee is allowed.